Tax bracket
By Jude Wallis
A tax bracket is a band of taxable income that meets one statutory rate. Income fills the lowest band first, then the next. Each band keeps its own rate after a higher one begins.
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The common mistake is to treat a threshold as a cliff. When income enters a higher band, only the part inside that band meets the higher rate. The marginal tax rate is the rate on the next dollar. The effective tax rate is total tax over the named base.
How tax brackets work is the explainer. The tax bracket calculator stacks a teaching schedule.